Overlapping International Instruments for Enforcement of Insolvency Judgments: Undermining or Strengthening Universalism?

Abstract

In recent years modified universalism has emerged as the normative framework for governing international insolvency. Yet, divergences from the norm, specifically regarding the enforcement of insolvency judgments, have also been apparent when the main global instrument for cross-border insolvency has been interpreted too narrowly as not providing the grounds for enforcing judgments emanating from main insolvency proceedings. This drawback cannot be overcome using general private international law instruments as they exclude insolvency from their scope. Thus, a new instrument – a model law on insolvency judgments – has been developed. The article analyses the model law on insolvency judgments against the backdrop of the existing cross-border insolvency regime. Specifically, the article asks whether overlaps and inconsistencies between the international instruments can undermine universalism. The finding is mixed. It is shown that the model law on insolvency judgments does add vigor to the cross-border insolvency system where the requirement to enforce and the way to seek enforcement of insolvency judgments is explicit and clear. The instrument should, therefore, be adopted widely. At the same time, ambiguities concerning refusal grounds based on proper jurisdiction and inconsistencies with the wider regime could undermine the system. Consequently, the article considers different ways of implementing the model law and using it in future cases, with the aim of maximizing its potential, including in view of further developments concerning enterprise groups and choice of law.

Keywords: Private International Law; Cross-Border Insolvency; Modified Universalism; Enforcement of Judgments; Model Law